In this briefing:
- HK Connect Discovery Weekly: Geely, Great Wall Motor and Sands China (2019-02-22)
- CSE Global: Gaining Momentum
- Yincheng Intl (银城国际) IPO Quick Note: A Highly Levered Nanjing Developer Bet
- 2019 Asia Casino Forecast: Highlights by Country and Performance
1. HK Connect Discovery Weekly: Geely, Great Wall Motor and Sands China (2019-02-22)
In our Discover HK Connect series, we aim to help our investors understand the flow of southbound trades via the Hong Kong Connect, as analyzed by our proprietary data engine. We will discuss the stocks that experienced the most inflow and outflow by mainland investors in the past seven days.
We split the stocks eligible for the Hong Kong Connect trade into three groups: component stocks in the HSCEI index, stocks with a market capitalization between USD 1 billion and USD 5 billion, and stocks with a market capitalization between USD 500 million and USD 1 billion.
In this week’s HK Connect Discovery, we highlight the strong inflow to automobile stocks and Sands China.
2. CSE Global: Gaining Momentum
- Investors who have bought CSE Global on dips since my last note would have profited ~18%.
- The upbeat guidance by management and supply-demand environment should give some legs to the recent rebound.
- While risks of slower global growth may weigh on the stock, the stock is trading below its five-year average PE despite significantly improved cash flow from operations and a healthy order intake (three-year high).
3. Yincheng Intl (银城国际) IPO Quick Note: A Highly Levered Nanjing Developer Bet
Yincheng International, a China Yangtze delta focused property developer, is raising up to USD 110 million to list on the Hong Kong Stock Exchange. In this note, we will cover the following topics:
- The company’s property portfolio
- Financial performance that concerns us
- Shareholders and use of proceeds
- Our view on the deal
4. 2019 Asia Casino Forecast: Highlights by Country and Performance
- Headwinds linger, but are beginning to lose velocity as consumers defy macro fears.
- VIP slowdown should peak by Q3 and begin northward creep as bankrolls replenish.
- Valuations today do not yet fully reflect the beginnings of a sector recovery.
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